South Dakota’s FY21 Budget

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The Main Run of the 2020 session gaveled out just before 11:00 p.m. last Thursday, with the budget being the last item of business.  The final budget for the next fiscal year which starts July 1 is slightly under $5 billion, with 36% coming from federal funds, 35% from state general funds, and 29% from other funds such as licenses and fees.

This budget reflects an increase of just one percent over last year’s budget.  At the same time, the budget includes two percent raises for education, state employee salaries, and community support providers.

Legislators also finalized changes to the current budget which ends on June 30.  Items included in these changes are $5 million for the state share of a new School of Health Sciences building at USD, $5.1 million to upgrade the state radio infrastructure system, and $5 million to expand rural access to broadband services.

The legislature also agreed to spend $4.1 million to help local governments pay for upgrading or replacing bridges in poor condition.  South Dakota received nearly $34 million in a federal bridge improvement grant.  The state Department of Transportation is proposing to share this money with local government entities proportionally based on the percentage of deck area in poor condition.  That means 23.5% on state highway bridges and 76.5% on local bridges.

Local match requirements for the $25.8 million in local bridge funding is approximately $5.9 million.  However, many local entities are unable to utilize these funds because of insufficient matching funds.  The $4.1 million will be allocated among local entities under a competitive application process, similar to the existing Local Bridge Improvement Grant program.  Under this program, consideration is given to the structural condition of the bridge, the amount of traffic it carries, and the length of the detour if the bridge was not there.

This funding provides $32 million for local bridge projects with the highest priority local bridges being completed with little or no costs to the local government entity.

Legislators are scheduled to return to Pierre on March 30 to consider any vetoes.  Governor Noem has already vetoed two bills – HB 1012 and HB 1013, dealing with correcting technical errors in statutory cross-references.

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